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Jacobs: Genmar firming up Chapter 11 exit strategy

In a letter to dealers today, Genmar chairman Irwin Jacobs said most of the company's factories are now operational, and will be in the foreseeable future, thanks to orders for new boats.

"Having stronger predictable order backlogs is allowing us to more confidently firm up our business plan and strategies for exiting the Chapter 11 process and, most importantly, to satisfy as effectively as possible all of the various contingencies," Jacobs said.

Genmar is taking actions to sell several "non-core assets," Jacobs said.

"Fundamentally, we believe implementing the sale of such non-core assets and applying those funds to reduce our loans will provide Genmar with refinancing opportunities that we confidently believe will allow us to be able to execute and finalize our reorganization plan," he said.

Genmar recently filed a motion to be allowed to sell three parcels in Sarasota, Fla., where various boat brands had been produced since 1984. However, operations ceased there in 2008.

According to court documents, Genmar would receive approximately $10 million from the sale of the properties. A hearing on the motion is set for Sept. 3.

In his letter, Jacobs also noted that Genmar is required to submit its plan of reorganization to the court by Sept. 29, though the intent is to file sooner.

"As we proceed forward, the most important factor for all of us is to successfully keep managing our businesses, which is obviously a key essential ingredient to our reorganization plan complemented by a strong Genmar dealer base," Jacobs said.

Click here for Jacobs' full letter.



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